EU pledges €2.0bn in green hydrogen investments in Brazil

SAO PAULO (ICIS)–The EU pledged this week to invest €2.0bn in hydrogen in Brazil as part of its Global Gateway investment programme.

The 27-country bloc did not clarify the timeframe for the investments, however, nor when they could start being deployed.

The €2.0bn investments in Brazil’s hydrogen industry would be part the EU’s Global Gateway €300bn programme, the 27-country bloc’s response to China’s Belt and Road Initiative, known inside China as the One Belt One Road.

The two programmes seek to expand the EU and China’s influence areas globally by investing in infrastructure.

Green hydrogen (GH2) is produced with renewable energy to power the electrolysis process, by means of which hydrogen is obtained from water. It has significantly lower emissions than grey hydrogen, which is primarily produced by steam reforming of natural gas.

LATIN AMERICA INVESTMENTS
Ursula Von der Leyen, President of the European Commission – the EU’s executive body – travelled to Brasilia this week to meet with President Luiz Inacio Lula da Silva as the EU and Brazil improve their relationship post-Jair Bolsonaro Administration.

Von der Leyen said the €2.0bn committed to Brazil’s hydrogen sector would be part of a wider €10.0bn package for other clean energy investments in Latin America and the Caribbean.

“In other words, we are ready to finance for example sustainable forest management, local supply chains, of course as well as clean energy infrastructure like hydrogen production,” she said.

“We want a long-term partnership, not a quick fix … And you are now building three ports that would allow Brazil to export clean hydrogen to the world. Let us work together on this. Because we Europeans have set ourselves the goal of importing 10m tonnes of renewable hydrogen every year by 2030.”

The EU Commission’s president went on to highlight Brazil’s “unlimited potential” for renewable energy, and specifically green hydrogen, which could be produced in the country in a “much cheaper” way than hydrogen produced from non-renewable sources.

“You have already started producing it [hydrogen], mostly actually thanks to technology made-in-Europe. So, we are interested in a reliable partner, we are interested in long-term trust and confidence. We are ready to invest in the whole value chain of renewables, and renewable hydrogen in Brazil,” concluded Von der Leyen.

“There are up €2.0bn waiting to be invested right now in renewable energy and energy efficiency. Together, we can build a transatlantic market for clean hydrogen as reliable and equal partners. In other words, let us join forces to save the planet and to grow our economies.”

GLOBAL GATEWAY VS BELT AND ROAD
In her speech after meeting Lula in the Planalto Palace in Brasilia – designed by the world-famous architect Oscar Niemeyer – the Commission’s president took pride in the Global Gateway programme, highlighting the sustainable nature of the investments.

“The difference [to other investment programmes] is that Global Gateway’s investments will be sustainable not only for the environment but also for our partners’ finances and for the local communities,” said Von der Leyen.

“It is a transparent and value-based offer. We want the added value to stay with the local communities.”

The EU has also promised to donate €20m for the Amazon Fund, which seeks to end deforestation in the Amazon by 2030, as committed by Brazil when it signed the 2015 Paris Accord.

In 2025, Brazil’s city of Belem is to host the UN’s 30th Conference of the Parties (COP30) on climate change.

Clarification: Re-casts paragraph 13